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tv   Countdown to the Closing Bell  FOX Business  January 14, 2013 3:00pm-4:00pm EST

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impact wool exports from new zealand, textile production in spain, and the use of medical technology in the u.s.? at t. rowe price, we understand the connections of a complex, global economy. it's just one reason over 75% of our mutual funds beat their 10-year lipper average. t. ro price. invest with confidence. request a prospectus or summary prospectus with investment information, risks, fees and expenses to read and consider carefully before investing. ♪ >> money is pouring into dell. just in the last hour or so dell shares up 13%. onward pc maker may go private. dell talking to private equity firms. we will get the lowdown from a
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top analyst coming up in just a few moments. hello, i'm cheryl casone at last hour of trading and the "countdown to the closing bell" begins right now. dell is front and center in the market but also about apple. major supply-chain issues taking place at apple. the stock down nearly 3% trading at $17 down right now, still up $500. apple cutting back on orders from component maker iphone five screens by 50% in the first quarter alone which is usually a risk that demand is not what it was, especially in the developed markets. the iphone five was supposed to be a home run with main street and wall street, now there are some major concerns. apple's pain may be research in motion's gain. at least that is the perception. putting up substantially higher today up more than 8.5% based on the idea apple is losing market
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share and perhaps rim is to gain some ground in the smartphone market, which is incredibly competitive. so what is the deal with apple? is there an inventory problem, or an issue of iphone five expectations getting too carried away? shibani joshi has been following the apple story for us today, what is really going on? shibani: there were high expectations for the quarter. and herein, this is normal after the holiday season the companies and most technology companies scaled back on supply-chain orders, but there is reason to be alarmed. a lot of the street has been coming on today to say this is no real news, has been baked into the cake already given some has leaked out in the summer. but we are getting reports from analysts giving us indications we should be concerned about whether or not people are buying the iphone five or not.
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taiwan semiconductors, the largest chip foundry that makes the chips that qualcomm designs that go into the iphone five. they put out an industry report about their numbers and in fact they have said sales declined 16% month over month, about double what the street was forecasting, so it is the component and component makers giving us some indication that perhaps people are not dying the iphone 5. it will create a ripple effect. it is not just about the iphone 5, it is everything that gets put into it and the ecosystem around it. qualcomm, at&t, verizon, all of those shares are down today. something the industry pays very close attention to. shares have pretty much stabilized around 3% because everybody is looking for more data. we will get that when they
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release the data. cheryl: that is very interesting from a technical standpoint. smart phones are so competitive. shibani, thank you. appreciate it. another take on apple with the future demand for apple and iphone levels. managing director and equity analyst with a buy rating, $800 price target on the stock. i want to start right there. $500 today, you say $800, will you reevaluate that number, peter? peter: no, we already looked up with the demand trends are. based on our work has sold over 50 million iphones in the quarter, which would be significantly above the street. we feel pretty comfortable with our numbers, we find some of these are important issues, kind of curious coming after when we first saw them. cheryl: the other piece of the pie was that maybe apple was a
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little too optimistic in the fourth quarter for sales come into the 2013. we are getting bigger numbers from samsung, market share numbers are gaining for samsung, apple losing sales as far as the marketshare goes. doesn't that factor into what we hear from the component makers? >> it does and it doesn't. i haven't identified where the cuts are from. in quarter for apple did 50 million iphones. samsung did somewhere around 18 million galaxy, around 8 million note to mack. they did somewhere around 26 million so apple was approximately double samsung's true competitive area. apple does not compete at the low end or the mid-end, only the high-end. apples to apples comparison, apple is still twice the size. cheryl: one man's treasure is another man's trash.
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and in that kind of goes to apple and rim right now, a big jump in rim stocks given the component makers seeing a scale back from apple. does rim win? >> it is interesting. look at the universe of beaten down tech companies, hp, dell, nokia, that group has performed remarkably well in the last month. it has been stunning actually. we're seeing portfolio managers and hedge fund managers buy these things on high short interest and there is the option value for those things. in research in motion's case there is a chance of success but it really will be dependent on how enterprises embrace their new handsets and how the consumers embrace the new handset and right now we're at a
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hold. we feel comfortable with that for the time being but certainly we would not want to be short. cheryl: you may have to reevaluate that one. another company, that is dell. and you have a hold on dell. but the news crossed the report, they're looking to go private. could be a good thing for the company, but what does this mean for shareholders? >> it means a higher price. the guess would be somewhere around $15 for private equity would need to bid to take this private. it is big news if true. probably some truth to it but getting a deal done in the fine print is very difficult. ask best buy and the former founder. pulling together a deal can be very challenging. cheryl: can dell make headwinds against hewlett-packard? the biggest problem has been hewlett-packard. where does that stand in your opinion? speak out if i were dell, with
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almost 60 pc businesses, with focus on the server-side, services side and i would say look, have the strongest s&p business in the world, i will monetize that and look for the cash flow there. i would dismiss the pc side of dell. cheryl: great to have you on the show especially on a day like today with so much news coming out of your particular sector. thank you very much. >> thank you for having me. cheryl: there is no real conviction out there. stocks on a narrow trading range. that'll pop especially over the last hour or so. 13,517. take a look at the dow and the rest of the major market averages as they stand today moving u it to the final hour of trading, and we are in it right now. still negative territory. the s&p, the russell 2000 trading to the downside as it is the first trading day of the
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week and a lot can happen in 55 minutes. of course over at the nymex. ben willis and therefore the new york stock exchange, i am sure you all were buzzing down there based on this dell news. what do you make of it? ben: the dell news does not have the impact even close to the impact of the others. apple really took the wind out of the sails of the market. great news coming out of the expansion of the economy in china based on their financial industry. that should carry us through the day. apple was disappointing i don't care if you're comparing apples to grapefruit. the manufacturer cancels 50% of their order, that is not a good sign. cheryl: that seems to be the big buzz particularly with apple shareholders right now.
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kevin is over at the cme. another piece of news we're getting today. apple and dell aside, ben bernanke said to speak about an hour from now to give a big speech. we're always curious what he is going to say but could it be a market moving type of address from the fed chief? kevin: it is worth noting today perfectly after they have come out last weekend with indications from voting members that may b maybe qualitative usg program could and did 2013. we will be looking for hints to see if there's any follow-up from the chairman on this because he is the one making the ultimate decision here. you look at the treasury prices today, we're off of our highs, not a lot driving things. a lot of data coming out this week that looks new to show us the health of the economy and with q4 earnings coming out this week, we will be watching and listening to corporate executives to see what the capital spending limit look like and that may drive things for the first half of the year.
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cheryl: more news in the oil market. tom riley right now at the nymex and i want to focus particularly with you on the issue of the oil contracts. we saw a big bump to the upside. maybe an overbought situation, but this could be a momentum traded to the upside. tom: we have been in a tight range for six to eight months now and trying to get our way out of there. saving that up for a week or so, you could see it drawing toward 100. lot of people buying wti and selling print over the last couple of months. we will see it come in a bit more. there is some room to the upside in crude oil. cheryl: gentlemen, i want to thank all of you for being on the floor show today and watching the market with 50 minutes to go. thank you. >> thank you. cheryl: it will be a great 50 minutes as we move toward the close because audi is firing on all soldiers. record sales in the
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united states. now the carmaker rolling out the hot new models. you will hear all about it right from the source. audi chairman and ceo rupert stadler in a fox business exclusive from the detroit auto show. what are you doing?
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cheryl: let's check in with nicole petallides at the new york stock exchange. nicole: of course they will be taking over as the chief executive officer on february 2. this to show and reiterate his confidence in the company, he actually boosted his stake in the company up to 56.5% up from 56.2. now, the ceo for two years but left because of a family issue with medical issues, so he is stepping down and you have the hedge fund billionaire stepping in as the chief executive officer.
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sears has struggled with same-store sales. a look at the one-year chart. today up eight and three quarters of a percent. certainly a big move with this vote of confidence. back to you. cheryl: nicole, thank you very much. do want to give you a market check right now. we'll get some things moving. i have some stocks hitting new highs. lions gate entertainment. $18 per share. johnson and johnson, take a look at those numbers. the global story. we will talk a lot more about dell. the closing bell will be ringing in 44 minutes from now but this stock is the one to watch moving into the close today. this stock picking off on private equity chatter, but is it legitimate? what is the street saying?
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charlie gasparino will have the latest on this story. we will be right back.
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adam: drivers are once again feeling pain at the pump. according to the survey, average price of a gallon of regular gasoline climbed $0.07 in three weeks t reached $3.32. coca-cola is taking on obesity. the beverage maker airing two-minute long ads showing it has provided drinks with fewer calories over the years and the obesity epidemic is not a result of its drinks. because people consume too many calories. paypal expanding the retail payment service that allows customers to use their accounts to pay for things at the store. the distraught appeals including
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radioshack and dollar general brings the number of national retailers using the company's payment system to 23. we continue our "countdown to the closing bell" with cheryl casone. cheryl: adam, thank you very much. i want to turn your attention to the market once again. we have 38 minutes to go, but as you can see, there is so much movement with a couple of stocks that are very important right now. wwe're up 29 points. not a big piece of movement, but look at the nasdaq and our guests pointed this out earlier. saying that is the composite to watch. you would think you get a bigger pop because of the dell news may be going private, but no, not so much. take a look at the s&p. watching the major market averages continuing to follow all the breaking news, lot of pressure on apple to date, also a big jump in oil.
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oil above $94 per barrel, so a few things we want to watch. not on "countdown to the closing bell." i was just talking about it, i was just talking about dell and the breaking news, this report they are in culinary talks about going private. but there are reasons maybe we should be skeptical. who else is on it, charlie gasparino who is not wearing a tie. hello. charlie: i have good friends at bloomberg, very good reporters. i am skeptical about this story. i know who the ultimate source of this story is. people talk to me. this is an investor banker driven story. not coming from the company from i understand this is coming from bankers who are pitching deals on this and i will tell you that if you believe investment
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bankers, you believe that every single company is in play. every single company is that talks about mergers, every single company is going private. they're talking about going private. we are talking because one investment bankers pop the question and maybe there are culinary considerations. ithey point out the difficulty f reading this i go back to the sourcing a will go through something in a minute, this is isn't $18 billion market cap company. a very mature company. you have to buy it, private equity firms buy it and take it private, the reason they do that is because they wants t want tot for something greater. are they going to be able to sell this thing for more money down the road? or is it a maturing business? i am skeptical from that standpoint, but the people who are pitching the story are investment bankers.
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after the conversation with the president of the yankees who mentioned to me an investor banker planted a story of how the yankees were up for sale and they were talking about it. investment banker called him up and said i am not interested. so there were talks about the yankees selling. i am telling you this has the smell of that situation. if you are an investor, take what i'm saying and what bloomberg is saying and make up your mind. for all i know this is going private tomorrow, i am just saying remember, taking a company private like this is a big lift and the source is not michael dell, it is, or their bankers desperately desperate looking for deals, so be very careful about this and remain dubious. if this thing happens, it is
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possible, but it just sounds. cheryl: i brought that up 30 minutes ago about hewlett-packard connection to all of this. if dell can't make and roads are taken off to the cleaners by hewlett-packard, what is a private equity, what is the gain for going private? charlie: maybe we don't have the market, the owners say we don't have the market. don't have to worry about the market judging us on a daily basis, we can grow the company, but you have got to think what are the chances that they will be able to grow enough to make it worthwhile for private equity firms. number two, i am telling you the source here are investor bankers. if you believe investment bankers, every single stock, every single company right now is thinking about going private
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looking for a merge, looking to sell, looking to buy something major. i am not saying it hasn't had talks between bankers and private equity or bankers and dell, i believe there have been based on what i have been reporting that i'm being honest with you. i am dubious. cheryl: they are desperate for deals right now. otherwise it is kind of quiet. they talk to everyone. charlie: they are looking for deals, maybe they got a little sniff out of this. for this to be real you need more than that. you people really sitting down and talking numbers. we should point out i don't think, i don't know if bloombe bloomberg, they called it preliminary and i think they are
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okay. i am just telling you, what is the stock going up? cheryl: $12 or something. what is it up? 8%, 9%. there we go. charlie: i cover wall street, it is actually coming down a little bit as we are talking about this. i will just say if you're an investor looking to play this, be careful. cheryl: charlie gasparino, thank you very much, appreciate it. good stuff. all right. the so-called fear index. you hear it all the time. the vix. how can we put this type of complacency or lack of volatility on our side as investors? paul hickey, the cofounder jointly now a fox business
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exclusive from stanford connecticut. i was just talking to charlie gasparino about it is so quiet right now and a perfect example is the vix. are we too comfortable, too complacent? >> the low reading of the vix in of itself is not such a bad thing, but what we saw to start out the year is record weekly decline in the vix. going back to 1990 we had never seen. we have seen 30% weekly decline from the vix, but what we consistently see in the market following the sharp sudden drops in the vix is below average market return over the next week, month, even out to three months. tend to see below average market return and average returns that are negative. when you suddenly see everybody really quickly decide everything is good, no need to worry, that is the time you may want to
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start worrying as a trader. cheryl: looking at the chart on the vix. it is the washington volatility spikes, thank you very much. which is expected, but everybody reacting at the same time. on the other side of the coin i am curious about the volatility of the vix. if you look at that chart, does it tell you something is coming? do you interpret what you've seeyou haveseen over the last ts as something is on its way? a major correction or the other side i'm a wordy for a huge bump in all the cash to the sideline they flood the market, what do you say? >> i think your second point may be what is more likely. when the vix started getting low last fall, people were worrying. we saw an immediate pullback in the market, but if you take the aftermath of the credit crisis,
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a lot of uncertainty. if you look back historically in the early 1990s we had a multiyear stretch for 80% of the data market close, the vix close below 15 for three years, s&p 500 was up 50% over that period. we saw another. in the last decade were close to 80% of all days to close below 15 and the s&p was up almost 30% over that period. the fact that the low vix in and of itself isn't necessarily such a bad thing. it is when you see a spike up which tends to be accompanied by a correction or a spike down when you want to be a little bit concerned over the short-term, but unless you are a short-term trader here, we don't see much to be worried about with the low vix. cheryl: we all remember how fat and happy and comfortable we
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were in 2007 and then came 2008. this is from a chart perspective, but are there certain sectors were watching that at this point are overextended? we have gotten too far ahead of ourselves? speak of the health care sector is one of the most wanted sectors. the financials have had a strong run to start the year. a lot of optimism and some of the rules regarding the dodd-frank, they will not be as restrictive as originally thought, so there is some of a relief rally. now we're getting into earnings. wells fargo released last week. expectations were so highly got to it, you tend to feel a lackluster results from the market. we could see that going into earnings season, you could see a pullback in the short term, but we're using the pullback. cheryl: i want to go back to the company were watching right now. boston scientific.
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they have had a nice run-up. 15% year-over-year. at the same time back in 2006 you had investors running from the same because of bad acquisitions it made. are you sure this company particular is back in favor? >> we think it will be back in favor for investors. a big part of their business is pacemakers and defibrillators. they purchased a company last year which makes new patented defibrillator technology. the big problem is they can be prone to failure at extracting the lead which goes into the heart can be a costly and risky procedure. this company has patented technology which they do not goingoto the heart of it is alle outside the heart which would be a lot less costly and recently received approval from the fda on the process, so it could really propel earnings here for the company and put the stock
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back on the table. cheryl: somebody i follow on twitter, i will say that my viewers. thank you very much. the closing bells going to ring, 17 minutes to go. the money rotating into stocks, we're talking about that next. it's a new day.
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>> let's go back to the floor of the new york stock exchange for some trader perspective. nicole? nicole: i'm here with jason weisberg. i said to him i want to get through a lot of topics fast. are you ready, jason? >> i'm ready.
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nicole: okay. first of all, apple, i'm telling you how everybody is sayyng less components orders, bad news, you say no? >> i think a lot of it is history, news this morning is nothing new. i think it is overdone. nicole: overdone, all right. dell, potential buyout offer, potentially going private. the stock soars what do you make of that? >> i think it is great for the stock market and great for the shareholders. the company sees value there. maybe it draws another bidder out. the fact is the company sees value in their own price, undervalued i think it is cheap to buy. stocks are cheap to buy in general. nicole: the vix lowest level in years. what do you think? what do you make of that? do you watch that? do traders watch that? >> traders do watch the vix. quite frankly i'm looking at charts of indexes right now. that's what i'm playing the market on. nicole: what chart, what index are you looking at. >> chart of the s&p. i'm looking at some of the etf charts. oil sector and financial sector
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and tech sector. nicole: how do you feel? you're looking at all the charts. i have seen your desk. you have about 20 screens available to you at any given moment. what do you feel when you are looking at them? do you feel good? do you think they are getting better? >> i feel like i have screen envy. but quite frankly i think the markets are going up and the charts say that unless earnings are a disaster. nicole: we should talk about the financials. the estimates for the financials there's been one group in particular that have been taken down a lot. what do you think? we have a lot of financials coming out this week? >> i think the earnings will be good but every time the government steps in, quite frankly, it's a never ending, you know, shot hat the financial system -- shot at the financial system, quite frankly if the government lets go -- nicole: give them a little breathing room. i think we got through a lot of topics. back to you. cheryl: nicole, you certainly did, appreciate it.
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for the first time in three years the s&p saw negative profit growth in the third quarter. what do those earnings mean for your portfolio? joining me now in a fox business exclusive is a chief market strategist. good to see you again. i'm looking at the cover here of your ing global perspectives. i think the title of this paper says it all, good economy, challenged markets. how badly challenged? you >> you said it in the opening. we have had three year market bolstered by three years advance in corporate earnings. this time it is different. first negative print in corporate earnings. that is not good. it is a sign to be defensive and taking that with look what's happening in europe. europe industrial production came out today. negative 4%. the worst since 2009. they are already in a recession. with that economic backdrop, what do we do? we did an anti-growth package with taxes. we raised taxes. not just for the rich, for
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everybody. and i don't think that bodes well for continuing growth, and that's why we're defensive. cheryl: one of the things you talk about here and i want to kind of pick apart this point if you don't mind is you're saying we should be looking at going for high yield and global bonds. fair enough. but if you've got a u.s. economy which is still the biggest economy in the world, if you've got a weak economy, unfortunately, i know you are saying good economy, but some are saying we are going to have a weak economy in 2013, if that's the case, do i want to be high yield? does that make sense to you? >> yeah, it does because high yield you get paid a lot of different ways. high income, risk adjusted return. last year up over 15%. almost as much as equities, but you're still getting paid to take that risk to be in there. global bonds is a win-win-win. you get paid on yield. you get paid on -- for diversification. you get paid on currency risk. so that's a good place to be. and i'm not saying we're in
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armageddon on the equities side i do like mid caps, but what i think you need to be is make sure just trim back a little bit on equities, and i don't think it's the end of the world. but good economy part is the consumer. we like the consumer because the fed with the quantitative easing is bolstering the consumer through housing, and that's why i think for the consumers, for main street, it's going to feel good, but for investors, for portfolio managers, i think it's going to be a challenge in the market. cheryl: okay. and you're talking about mid cap, but also you're talking about global reits, and i think that's a very interesting strategy, and certainly something we don't hear much about. u.s. based reits certainly have done fairly well, particularly with the housing recovery, but also -- with the growth of the aging population in this country. what can i get though out of a global reit that i can't get out of a u.s.-based reit? >> global reits were up 29% in
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2012. this was the spot. this is what as you said nobody's been looking at, and we've had in our portfolio really rewarded. reits i like in general because you're getting paid a real good cash flow, real good yield, and you're getting capital appreciation. in the u.s., reits were up about 20%. nothing to sneeze at, but i like the global diversification. i like the broad depth of the markets, and i think you're going to have to look beyond just the u.s. although, in global reits, u.s. is a big part of it. cheryl: you mentioned one of my favorite topics in my paper, frontier markets, good read. doug thank you very much. >> you are welcome. cheryl: closing bell going to ring -- we now have about 16 minutes to go. nicole is talking about it, sears, flying high, the retailer popping on heavy volume today. talking about that. but as ben bernanke takes the mic, the fed chairman, he has a
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big panel discussion coming up, his speech could move tomorrow's market anyway. we're going to be right back with more on that as we round out the first hour. ♪ what are you doing?
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nothing. are you stealing our daughter's school supplies and taking them to work?
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no, i was just looking for my stapler and my... this thing. i save money by using fedex ground and buy my own supplies. that's a great idea. i'm going to go... we got clients in today. [ male announcer ] save on ground shipping at fedex office.
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cheryl: fed chief bernanke is visiting the university of michigan and he is expected to hold a conversation anyway about monetary policy in the next hour. we're going to be watching for anything he says that affects our economy. of course your own investments. peter barnes has a preview right now out of washington. peter? peter: that's right, cheryl. expect some head lines here from the fed chief when he speaks here at the university of michigan at the top of the hour for 90 minutes, in particular, we're looking for news about the
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latest fed minutes and the debate inside the fed on possibly ending the latest round of quantitative easing, sometime this year, a little earlier than perhaps was expected. the minutes suggested a majority of members want to do that now. the debate among them was over whether or not to end qe forever by the end of the year, or maybe some time sooner than that. now, bernanke will answer questions from professor susan collins. she's the dean of the school of public policy at the university. she told the washington post that she does plan to ask him about this quantitative easing qe 4 debate inside the fed. she also plans to ask him about the fed's new targets for when it might start to raise interest rates. it says it won't start doing that as you know now until unemployment gets to at least 6 1/2% or until inflation gets to -- if it hits 2 1/2%, then
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they would start to tighten. for the first time, the fed chairman is going to take questions through social media, through twitter, but not through the fed's handle, through a handle that the school has established, specifically for this event. we will be on our twitter account as we watch the questions come up. cheryl: peter, i follow the federal reserve on twitter. it is probably the most twitter feed, not lying. they have to step up their game a little bit. if you know people over there, let them know. peter: i will pass your complaints along to management. cheryl: please do. thank you very much. peter barnes, and of course we will be following if the fed chief says anything ground breaking in the next hour. we have also been following news on dell and apple today. but there are some other technology headlines we're watching. jpmorgan making a few changes to some big names. here you go, take a look at ibm, this one cut to neutral from overweight. also jpmorgan downgraded emc. so there you go. right now ibm tho the down side.
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-- to the down side. emc hanging in there 3 cents anyway. hewlett-packard, getting an upgrade from the company. also fusion-io. again, today it's just all about apple. all about apple. but there's another name we're watching. adam shapiro is taking a look -- take it away adam. sears is moving. adam: do you remember the old slogan sears where america shops? do you remember that cheryl? cheryl: no i don't. adam: americans haven't been shopping so much at sears. or for that matter kmart. remember back this 05 lampert merged the two companies, 11 billion dollars deal. trying to turn this retailer around not only sears but kmart
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for several years trying to make some traction. last week they got the big news that abrozio was leaving. today it was announced that mr. lambert is actually upping his stake in sears, roughly -- he's going to 56.5%, up from 56.2%. filings just put in with the sec. some of what's going on with sears, i mean they are still struggling, but essentially for the nine weeks that ended december 29th, same-store sales up 5/10 of a percent. that's at sears. kmart still struggling. same-store sales 3.8% for that same time period. the street is looking for reassurance that the trajectory they were on, they are still on that. mr. lambert will be taking over on february 2nd as the ceo. back to you. cheryl: adam, thank you very
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much. closing bell ringing in 7 minutes on this monday. there is one company that is trading, and it focuses on diamonds. this will deal turn investors to make this new company their best friend? we will talk about it coming up. ♪ diamonds are a girl's best friend ♪ ♪
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♪ [ male announcer ] this is karen anjeremiah. they don't know it yet, but they' gonna fall in love,
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get married, have a couple of kids, [ children laughing ] move to the country, and live a long, happy life together where they almost never fight about money. [ dog barks ] because right after they get married, they'll find some retirement people who are paid on salary, not commission. they'll get straightforward guidance and be able to focus on other things, like each other, which isn't rocket science. it's just common sense. from td ameritrade. cheryl: i have to tell you this company i think liz claman and i both love this one. harry winston take a look at the stock right now, it is shining bright. they are announcing they are going to sell its watch and jewelry business in a deal with swatch group. harry winston shifting its focus
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to diamond mining activities. i'm seeing the watches right now, it is going to be interesting. the swatch group the world's largest watch maker is based in switzerland they are buying up the brand in a deal, we have been talking about it all day long. shares of both companies hitting 52 week highs today. i tell you what right now, david asman sandra smith dow up 12 but i'm singing diamonds are a girl's best friend in my head. david: i thought tiffany's was a girl's best friend. cheryl: that too. david: it looks like apple is sort of holding the line in the sand. it is not really going that much below 500, but still a huge drop in apple on word that the suppliers are concerned, they are not ordering as much stuff because they are not selling as many iphone 5 as they thought they were so they are ordering about half as many parts as they used to. big concern on apple, but big positive news


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